Same amount of wool taken by trade

Press, 29 April 1981, Page 16

Same amount of wool taken by trade

The purchases made this year by the Wool Board in support of a flagging market should not be seen as representing, a significant decline in consumption of wool by the international trade, said the managing director of the board, Mr H. L. M. Peirse, reporting to the statistics committee of the International Wool Textile Organisation in Christchurch. The board’s stockpile has increased from 114,000 bales at the start of the season to about 340,000 bales. Mr Peirse said that while there had been considerable changes in the amounts shipped to various destinations, the total amount taken by the trade to the end of March was only 8000 bales, or 0.5 per cent, less than in the same period last year. “The build-up in board’s stocks can be attributed almost totally to the continuing increase in wool production we are experiencing in New Zealand,” Mr Peirse said. “Over the last four years’

the clip has expanded at a staggering rate — from 311,000 tonnes, 321,000 tonnes, 357,000 tonnes, to an estimated 385,000 tonnes this season.”

The most outstanding feature of the season in terms of exports had been the rapid emergence of China as a very substantial buyer of New Zealand wool, he said.

In the eight months to the end of February China was New Zealand’s largest customer, having bought about 16,300 tonnes clean compared with 7320 tonnes in the corresponding period of 1979-80. However, by the end of March the Soviet Union with almost 20,000 tonnes had edged ahead of China by about 100 tonnes, and it appeared as though the Russians would again- be New Zealand’s largest purchaser this season with China and the United Kingdom vying for second place. To a question about the relevence of Government support for wool in relation to market trends and de-

mand, Mr Peirse said that it had to be seen in relation to the over-all meat and wool returns. In the previous two or three years it had been associated with a pattern of increasing exports and increasing prices.

Increases in production up to the 1979-80 season had been absorbed commercially, but there was a question now as to how long extra production might have to remain in the board's stores. It would be interesting to see if the Government retained, the same posture as it had done in the past.

Mr R. Williams, of the economics department of the Australian Wool Corporation, said that total wool production was forecast to be down this season by 4.3 per cent. Down an estimated 4.1 per cent because of drought, shorn wool production this season would be the lowest for 23 years, except, for one season.

All indications were that wool production next season would be no higher than in

the present season and might be slightly lower. Unofficial estimates suggest that sheep ■numbers at March 31 would have been down by about 5.9 million to about 130 million as a result bf drought and a high level of live animal exports and slaughterings. If the estimate was accurate “it would mean that the sheep population in Australia would be the lowest for 27 years. ' ' • . However, in contrast, to the situation in New-Zealand, the average price of greasy wool in Australia this season to the middle of this month was running about 14c a kilogram higher than last season.

As well as hearing reports from wool producing countries, the committee. also received reviews of conditions in the manufacturing areas of the world and at the end of these the chairman, Mr W. A. Williams, commented: “In some areas there are signs of optimism, but gloom appears to be the keynote of most reports.”